(Updates with closing prices)
By Peter Hobson
LONDON, May 22 (Reuters) - Copper prices hit a four-month low on Wednesday as an intensifying trade dispute between the United States and China took its toll on industrial metals with investors fearing damage to economic growth and weakened demand.
Aluminium also hit its lowest since January 2017 after a Brazilian court lifted production restrictions on a major alumina plant.
Benchmark copper on the London Metal Exchange (LME) closed down 1.1% at $5,928 a tonne after reaching $5,913.50, the lowest since Jan. 24.
The metal used in power and gas has fallen for four consecutive sessions and is down around 20% from highs in early June 2018, before the trade conflict began.
Societe Generale analyst Robin Bhar said the worsening macro-economic backdrop and trade situation were pushing metals lower, with speculative investors leading the selling.
"Physical buyers are few and far between with all this uncertainty," he said.
TRADE WAR: China must prepare for difficult times, President Xi Jinping said on Wednesday after China's ambassador to the United States said Beijing was ready to resume trade talks.
Media reports said Washington was considering Huawei-like sanctions on Chinese video surveillance firm Hikvision, potentially inflaming the confrontation.
U.S. Treasury Secretary Steven Mnuchin said Washington was considering further tariff increases and is at least a month away from enacting them.
JAPAN: Japanese exports contracted for the fifth month in April, underlining the threat from the trade dispute.
COPPER POSITIONING/TECHNICALS: Speculators' net short in LME copper has expanded to 6.2% of open contracts, the most since October, brokers Marex Spectron said.
"Copper is likewise under pressure from a technical perspective. If it is unable to defend the $6,000 mark, technical selling is likely to send the price into a further tailspin," said analysts at Commerzbank.
SPREADS: The discount of cash copper and aluminium on the LME to the three-month contracts has grown, suggesting ample supply of nearby metal. MCU0-3 MAL0-3
PERU STRIKE: Chinese miner MMG said operations at its Las Bambas copper mine in Peru had not been disrupted by a road blockade.
ALUMINIUM/NORSK HYDRO: The Albras aluminium smelter in Brazil, partly owned by Norsk Hydro, began to ramp up its output after a Brazilian federal court lifted production restrictions at the Alunorte alumina plant.
"This is seen as negative (for prices) as it could lower the input cost for aluminium production," analysts at ANZ bank said.
LME aluminium ended down 1% at $1,779 a tonne after hitting a more than two-year low of $1,776.50 a tonne.
OTHER METALS: Benchmark zinc fell 1.3% to $2,543 a tonne, lead lost 0.3% to $1,800 and tin finished down 0.6% at $19,325. Nickel was not included in closing rings, but had slipped 0.7% to $11,980 in electronic trading.
Reporting by Peter Hobson; additional reporting by Tom Daly; Editing by Louise Heavens and Alexander Smith